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16 May, 02:00

On October 31, 2017, Lexington Corp. declared and issued a 12% common stock dividend. Prior to this dividend, Lexington had 302,000 shares of $.001 par value common stock issued and outstanding. The fair value of Lexington's common stock was $16.75 per share on October 31, 2017. As a result of this stock dividend, the company's total stockholders' equity

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  1. 16 May, 04:19
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    The total equity suffer no change.

    Journal entry:

    Retained earnings 607,020 debit

    Common Stock 362.4 credit

    Additional Paid-in 606,657.4 credit

    Explanation:

    Stock dividends reduce a equity account - -> retained earnings

    And also, they increase equity accounts - -> common quity and additional paid-in in excess of par.

    value of the stock issued:

    302,000 shares x 12% = 36,240 shares

    36,240 shares x $16.75 = $ 607,020

    Common stock: 36,240 x 0.01 = 362.4

    Additional paid in: 607,020 - 362.4 = 606,657.6
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Home » Business » On October 31, 2017, Lexington Corp. declared and issued a 12% common stock dividend. Prior to this dividend, Lexington had 302,000 shares of $.001 par value common stock issued and outstanding. The fair value of Lexington's common stock was $16.
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